The Obvious Choice Isn’t Always the Right Choice

As humans, especially U.S. Consumers, we have been trained to choose products based on branding. Branding breeds confidence so we assume that if we have heard of something, it must be good. There are plenty of contrarians out there that will disagree with the obvious choices because they want to be different or perhaps they had a personal experience that is motivating their position. I remember back in the early 2000’s when I lived in San Francisco, people would debate Starbucks vs. Peets. They both make good coffee but some people just wanted to favor the little guy or they judged Starbucks for things other than coffee. But most people preferred Starbucks because they had better branding and they created an experience around their brand. When I go to Peets, I just don’t hear people ordering a double tall, skinny, extra foam, 110 degree, soy latte. But at Starbucks they encourage this kind of ordering because its synonymous with their brand. This doesn’t mean Peets doesn’t have good coffee. In fact, I prefer Peet’s drip coffee and Starbucks espresso drinks. The point is, take branding with a grain of salt and make decisions based on your likes, needs, and wants. The same holds true for business decisions. We all lean into the brands we know because their branding breeds confidence. But what if you are wrong?

What if people do order their custom drinks at Peet’s like they do at Starbucks? I’m not 100% sure that my statement above is correct but I believe it. I think of Starbucks one way and Peet’s another. In order for me to change the way I think, Peet’s will likely need to brand themselves a certain way or I will need to hear from several coffee enthusiasts that I am wrong. In business, because of branding, we immediately think of specific companies when in need of a solution. For example:

  • CRM = Salesforce
  • eCommerce Platform = Shopify
  • ESP = Klaviyo
  • DSP – The Trade Desk
  • Audio = Spotify
  • Social Media = Facebook
  • Shopping = Amazon

It’s not that these aren’t the best companies in their categories, they could be for some brands and not for others. This topic is nuanced and the right answer depends on a variety of factors related to each brands specific needs. For example:

  • CRM: Sure, Salesforce revolutionized the space but they are an enterprise platform with lots of bells and whistles that may be too much for some companies. They may be great for large organizations but not for smaller ones. Personally, at Cogent we use Hubspot and it does everything that we need it to and thensome. We used Salesforce at Criteo and we loved it but it isn’t what we need at Cogent.
  • eCommerce Platform: Again, Shopify has revolutionized the space. They started targeting smaller merchants and then grew into larger ones with Shopify Plus. But there are plenty of eCommerce brands out there that use Bigcommerce, Magento, or utilize a homegrown solution because the out of the box solutions just don’t meet their needs.
  • DSP: We all know the dramatic rise of TTD. Personally, I haven’t used them but I hear they do a great job at providing easy access to all channels, datasets, and tools needed to execute campaigns. I have also heard that they charge a lot of extra fees, some of which can’t even be identified. There is a cost of convenience in anything and each buyer needs to understand and decide if the trade off is worth it. I will say that the “ad tax” in our industry is out of control and brands should find ways to avoid or reduce it so that more of their budget can go toward reaching consumers.

Building on the DSP example above, if you are a user of TTD, take a deep look at their capabilities and ask yourself, “are they the best at everything” or are they just the best at some things? Could there be better ways to serve my clients by opening my mind to specific solutions that address my clients needs. Audio advertising is a great example to use here. TTD is good for display, no doubt, but do you know what their reach is for audio? Do you know how they buy audio? Are you 100% clear on the fees they charge and the impact they have on performance? Is TTD transparent? Do they offer you everything that you want in running audio campaigns?

Perhaps you are better off buying directly from a few publishers and using a DSP for more reach and to lower your average CPM. Perhaps you should consider another DSP just for audio. I did my own analysis comparing TTD to Audiohook, an audio only DSP which you can see below. I understand that brands and agencies make annual commitments to TTD to receive lower fees but if you aren’t getting what you or your client need, so what:

  • Primary source of inventory: TTD desk talks about some of their premium relationships but the majority of their inventory comes from SSP’s. Audiohook has mostly direct publisher relationships which gives them access to more inventory, inventory that never reaches the SSP’s, has reach across broadcast, streaming, and podcasts. And because of the way they buy, they can pass along better rates.
  • Platform Fee: TTD charges publishers a hefty fee to sell their inventory through TTD. These fees get passed on to the buyers which drives up the CPM’s into the mid-teens. AH doesn’t charge any publisher seel fees so their CPM’s tend to be sub $10.
  • Data Fees: AH doesn’t charge any mark-ups on 3rd party data nor do they charge a markup for using 1PD via Liveramp
  • Ad Verification: Use anyone you’d like at no additional markup with AH
  • Measurement & Attribution: Use anyone you’d like or take advantage of AH’s purpose built tools because audio advertising is very different from display

Sure, it might be easier to buy from TTD because you are buying display and maybe CTV, but think about the impact this could have on your overall business. Then think about in the context of every partner you use and ask yourself, “am I making the right choice or just the obvious choice?”

Cogent operates a discovery and evaluation platform to help brands discover and compare vendors for their specific needs. Cogent’s mission is to make the buying and selling of tech solutions easier and better, no matter which vendors you ultimately choose to work with. Having quantifiable data to justify your decisions can never be the wrong thing to have.

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